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We’re Going to be Hit with a Tsunami of Inflation-Peter Schiff

Monday, February 17, 2014

By Paul Martin

By Greg Hunter
USAWatchdog.com
February 17, 2014

Money manager Peter Schiff has a read on gold short sellers. Schiff says, “Of course the short sellers never had the gold to begin with. They’re selling gold they don’t have, and I think the shorts are getting a little bit nervous, but they are going to get a lot more nervous as we turn up the heat here. Gold is now above $1,300 (per ounce). I think it’s going to be above $1,400 before they start to panic a little bit, and I think that’s great.” Schiff goes on to say, “I like the fact the market is moving up and nobody is buying it, nobody is paying attention to it. If they are, they are dismissing it. People think this is a head fake or a dead cat bounce. Instead, it’s the resumption of the (gold) bull market.”

On gold mining stocks, Schiff proclaims, “The valuations are phenomenal in the mining sector because everybody assumed that the price of gold was going to keep falling, and those false assumptions were built into these share prices. So, I think there is a tremendous opportunity for people who want to hit a home run in gold and silver to get into the mining companies. . . . The best performing stock funds so far in 2014 are the gold funds.”

On the effect of Obama Care on the economy, Schiff contends, “The employment base is collapsing; so, the tax base is collapsing. The budget deficits are going to get bigger than ever. They just voted to raise the debt limit, but they didn’t actually just raise the limit–they suspended it. So, in fact, the sky is the limit. They can pile on as much debt as they want to because right now, there IS no limit to the amount of debt we can have, which means we are going to get a lot more debt. Everybody thinks this is good news. . . . Why is that good news? Maybe that’s good news if you are a gold investor, but it’s bad news for everybody else.”

On the possibility of another financial crash, Schiff says, “The messes get progressively bigger because the bubbles get progressively bigger. We have the biggest bubble ever blown right now because we have a simultaneous bubble in the stock market and the real estate market and the bond market. . . . The air is coming out of all of them. The Fed knows this bubble is too big to pop. That’s why the Fed is going to come back with an even bigger round of QE (money printing) than the last round. We’re going to be hit with a tsunami of inflation. . . . I think we’re going to be stuck with a lot of the money, which means it will bid up consumer prices. New Fed Chief Janet Yellen said she wants more inflation. Well, she’s going to get it.”

Schiff thinks the U. S. Dollar will be in trouble first and not Treasury Bonds. Why? Schiff says, “The dollar will go poof first. Remember, the Federal Reserve can buy up all those bonds to stop the prices from collapsing, but in order to do so, it has to print dollars. But, eventually, the dollar collapses because the world figures out the game. The Fed can print all the dollars they want, but they can’t force people to accept them. That is going to be the problem.” (There is much more in the video interview.)

After the interview:
Peter Schiff said, “The economy is going to be so bad by the November mid-term elections that he’s not sure the Republican’s will take back the Senate. Schiff contends, “The weaker the economy is, the stronger the Democrats will be because people will be more dependent on government. People don’t need dependency, they need freedom. The Democrats cripple you and then give you free crutches.”